The Government Suggested to Return to Auction for Nickel Exploration Areas

JAKARTA - The Association of Indonesian Mining Experts (Perhapi) advises the government to re-activate the auction for nickel exploration areas. This aims to immediately find new nickel reserves in Indonesia.

Perhapi Chairperson Rizal Kasli said that until now his party still did not know the clarity and progress of this activity because it was still being processed by the Ministry of Energy and Mineral Resources.

"One other thing I would like to share is that the government must re-activate the auction for exploration areas for nickel," said Rizal as quoted on Friday, August 11.

According to him, if this activity is reactivated, it can add to the life of the domestic processing industry or smelter. This is because high-grade nickel ore reserves are expected to only last for the next few years.

Based on data from the Geological Agency of the Ministry of Energy and Mineral Resources, Indonesia's total nickel resources are recorded at 17.3 billion tons while total reserves reach 5.08 billion tons.

The Geological Agency also estimates that high-grade nickel ore reserves of 1.5 percent and above or saprolite are only sufficient for the next 9 years, assuming domestic absorption reaches 387.2 million tonnes per year.

Meanwhile, for low grade nickel (below 1.5 percent or liimonit), it is recorded that the resource has reached 32 years, assuming domestic consumption is around 58 million tons per year.

Rizal is of the opinion that if the government does not again intensify the auction for Nickel IUPK areas, it is feared that the smelters that have been established will have difficulty supplying nickel.

"We are worried that the smelter being built will have problems with feeding the ore," concluded Rizal.